Trading is purely a hobby for me. I don't need to make a living through trading. Because it is so difficult to achieve positive results does trading pose a challenge. It is this challenge which makes trading interesting, not the financial rewards. I spend on average 1~2 hours per day on it, 5 or 6 days per week.
Trading is a way of earning or hobby?
- Thread starter Jamie J.
- Start date
Its definitely easier to make money trading when you dont rely on the money, it takes years of trading to get to the point where you dont allow the money to affect decisions.
Hello,
I have a full time career job for paying the bills and family, etc etc.
Trading for me is more of a hobby and possible additional income. It's a great challenge trying to figure our how to make consistent money comfortable and less stressful. But lately it's becoming more of an obession but fun obession.
I am unprofitable and trading paper til it figure out what works. Slowly but surely.
I have a full time career job for paying the bills and family, etc etc.
Trading for me is more of a hobby and possible additional income. It's a great challenge trying to figure our how to make consistent money comfortable and less stressful. But lately it's becoming more of an obession but fun obession.
I am unprofitable and trading paper til it figure out what works. Slowly but surely.
No one trades as a 'hobby'...whatever the heck that even means
We're not doing this because it's Fun -- it's about money. and money is usually stressful and serious.
If someone claims to trade as a hobby or part time...it's fairly safe to say, or assume, they're one of the 95%+ of traders out there that is losing money.
It is about money and making as much as can be safely, whatever that is, to be. But it started out as a hobby, and I have worked way beyond full time for decades to gain knowledge and I have. I started young buying rental houses and starting small businesses, except last 8 years of illnesses, I have ALWAYS had a night job and traded days. I love designing and back testing my systems, and always detested the actual trading part, the challenge to get better if only by half a tick. A couple times I have had to trade to support myself and did, but I have always treated trading as full time and then some hobby. I have very nice 401k and Roth from it and going to keep it going till day I drop, and why not, don't see Buffet quitting any time soon. But automation is very nice way to trade for me.
Keep the career, and keep trading on the side, whatever you do dont dive into trading hardcore till you got atleast 2 years of bills covered, and you have proven yourself with real dollars on the line. I was lucky enough to find trading in University when i was 20 when the money didnt matter, cause i lived at home, and and another had a another way to make money so i didnt need it.
With that said, early in my career worked at a prop firm with a hundreds of traders, and i only know 3 of those guys who are still doing this
Since then i have hit many times where trading became incredibly difficult cause i needed the money, (mostly tax situations,) twice in my career i have taken a bath in January, or February and had no money to pay the tax bill from the year before because i was trying to grow accounts agressively, and i wasnt setting anything aside for taxes, I once walked in too the gas station and couldnt pay for the gas in my car cause the government put a freeze on my account cause i owed 45k in taxes, it took a year of poor trading, and hardcore grinding to get myself out of that, but i would have went bankrupt if i didnt know what i was doing, and if i had a massive nut to pay every month.
Alot of the time the simulator doesnt do much for people cause at the end of the day you can just reset it, Make sure you are taking vigorous stats, and studying, but i really think at the end of the day you need to take some losses that will sting in order to learn.
By no means am i encouraging you to go out and become a cowboy with an account and blow it out so you can learn, but IMO good trading is really about figuring out what you can or cannot get away with, and most of the time you only learn that lesson by losing real money.
What i mean by that is this, some days you will notice setups that are highly profitable to chase, but other days chasing what seems like a breakout/breakdown will kill you, same thing with being stubborn on a long/short that you have conviction on that keeps going against you.
You need years to seperate the two, and IMO its like a kid touching a hot stove, eventually in trading you just get burned enough to know what you absolutely CAN NOT DO in the market, then its just about refining the things you CAN DO and getting better at it. This leads to another point that i could talk about for days, but make sure you find your "niche" in the market, there is a million different ways to skin a cat but you will only learn what works best for you through trial and error.
Anyways, Hope this helps and it doesnt seem like incoherent rambling.
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Plan A
Its a lot easier to swing/position/trend trade while working full time - then quit once you have a large amount of money and than do wealth mgmt where you can get by making about 10% ROR - this an ideal situation for a good risk mgmt oriented trader.
Plan B
Most pros (CTA's) will say you need at least 5X capital over your annual cost of living at a minimum to have a chance of going the distance. That means you will need to avg 20% ROR just to tread water. Don't forget the perks from your job you will have to now pay for like health insurance and factor in those you lose like matching 401k, paid vacations, etc. Hence you will need well over 20% to offset these perks. The best traders over the long run can make 20%+ ROR - you have to honestly ask yourself if you really think you are in that league.
Do to being ask by my employer to relocate off of Maui where I worked from home for the last 12 years I am seriously considering going back to plan B trading - the last time I did this I made it 6 years starting with $375k and returned to work with $60k remaining. The lessons were priceless, I even made it to the 7 digits b4 self destructing - all that money was made from trading to start with so no regrets - got to live like a rock star for a while. Life is to long to be stuck in a downtown office cubicle.
My plan B trading mantra
"Physically I am alive. Morally I am free. The world which I have departed is a menagerie. The dawn is breaking on a new world, a jungle world in which lean spirits roam with sharp claws. If a am a hyena I am a lean and hungry one: I go forth to fatten myself." ~ Henry Miller
Its a lot easier to swing/position/trend trade while working full time - then quit once you have a large amount of money and than do wealth mgmt where you can get by making about 10% ROR - this an ideal situation for a good risk mgmt oriented trader.
Plan B
Most pros (CTA's) will say you need at least 5X capital over your annual cost of living at a minimum to have a chance of going the distance. That means you will need to avg 20% ROR just to tread water. Don't forget the perks from your job you will have to now pay for like health insurance and factor in those you lose like matching 401k, paid vacations, etc. Hence you will need well over 20% to offset these perks. The best traders over the long run can make 20%+ ROR - you have to honestly ask yourself if you really think you are in that league.
Do to being ask by my employer to relocate off of Maui where I worked from home for the last 12 years I am seriously considering going back to plan B trading - the last time I did this I made it 6 years starting with $375k and returned to work with $60k remaining. The lessons were priceless, I even made it to the 7 digits b4 self destructing - all that money was made from trading to start with so no regrets - got to live like a rock star for a while. Life is to long to be stuck in a downtown office cubicle.
My plan B trading mantra
"Physically I am alive. Morally I am free. The world which I have departed is a menagerie. The dawn is breaking on a new world, a jungle world in which lean spirits roam with sharp claws. If a am a hyena I am a lean and hungry one: I go forth to fatten myself." ~ Henry Miller
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Max, look at incorporating as a sub chapter S Corp (or whatever the equivalent is in Canada). You can take corporate deductions and since it's a pass through you don't pay double tax
Thx for the tip, i will look into it, i went over this with an accountant a few years ago, but he was a shitty accountant, and his ideas all seemed like ideas that would just create a ton more paperwork and business for him, but not really save me enough to make it worth while.
The other option ive thought of since im in canada is just moving to a tax haven for the majority of the year cause canada isnt like the u.s. where you get taxed no matter where you are as long as your a citizen. Living in the carribean for half the year would sure make canadian winters more tolerable.
How often does the failure occur? Does this make you change such a hobby?